Airbnb Sues Hometown San Francisco Over New Law on Rental Restrictions

Airbnb is suing the city of San Francisco over a law which the hometown company argues is in violation of the First Amendment. Airbnb claims that a law coming into full effect next month will  impose fines on home-sharing services that offer short-term rentals illegally.

The law would require Airbnb to ensure all hosts on its platform have registered with the city or risk steep fines. Airbnb would not be the only company affected—VRBO and HomeAway could also faces fines up to $1,000 per day if they fail to list each short-term rental host’s registration number.

“While we have attempted to work with the city on sensible, lawful alternatives to this flawed new ordinance, we regret that we are forced to now ask a federal court to intervene in this matter,” Airbnb said in a statement. “This is an unprecedented step for Airbnb, and one we do not take lightly, but we believe it’s the best way to protect our community of hosts and guests.”

Airbnb argues the new rule violates an act which prevents legislators from sanctioning websites for content posted by users; San Francisco counters this by saying the law targets Airbnb’s operations from a business angle, not necessarily the content of its website.

The company is currently valued at more than $25 billion and operates in virtually every city in the world. But San Francisco, where it was launched and remains headquartered today, has been possibly its most difficult market.